Industry Insights
March 2024
By PGL
In breaking news: early Tuesday morning on March 26, the container ship Dali lost power, crashing into the Francis Scott Key Bridge that spans the mouth of the Patapsco River in Baltimore. The resulting collapse has shut down this portion of I-695 as well as the Port of Baltimore. As of the recording of this report, the ships crew is uninjured, and search and rescue efforts are underway for several people that are believed to have fallen into the river, including a construction crew that was working on the road at the time of the collision. Given the 45 degree fahrenheit water temperature, authorities are not optimistic about about their fate.
We can expect this tragic event to have far-reaching effects on logistics on the east coast. PGL will continue to monitor this developing situation.
Welcome to the PGL Industry Insights report for March 2024
In labor news, contract negotiations between the International Longshoremen’s Association (ILA) and the United States Maritime Alliance (USMX) are strained, with a potential coastwide strike looming as the ILA warns its members to prepare for October 2024. Concerns over disruptions in East and Gulf Coast ports parallel past issues on the West Coast.
Trucking transportation prices showed growth for the second consecutive month in February, but the rate of capacity expansion outpaced pricing growth, indicating that a significant recovery in the freight cycle has not yet begun. While transportation capacity increased, utilization also rose, suggesting that the industry has not yet entered a true growth period.
Freight shipments and expenditures saw improvement from January to February. Despite remaining lower year over year, the smallest decline in 10 months suggests a potential recovery is beginning, supported by an uptick in actual freight rates and strong new equipment orders.
The benchmark diesel price experienced a slight increase despite significant gains in futures prices for ultra low sulfur diesel, highlighting a delay in reflecting wholesale price changes at the retail level.
Ocean shipping news is indicating that February’s U.S. container import volumes dipped by 6% from January, a better-than-expected performance for the typically slow season, but other indicators hint at potential softness in domestic freight for March and April.
Over recent months, Houthi rebel attacks on cargo vessels have been threatening both regional stability and global commerce. Although the assaults have introduced complexity and risk to maritime trade, the impact on commerce may be diminishing as supply chains adapt and reroute vessels, mitigating some of the disruptions caused by the attacks, leading to long-term effects in many parts of the logistics industries.
The air cargo market has experienced a robust start to the year, propelled by strong e-commerce activity in Asia and disruptions in ocean freight due to the Red Sea conflict. While the growth appears significant, questions remain about its sustainability and whether it’s driven by favorable year-over-year comparisons.
We’ll be back next month with another Industry Insights Report. As always, PGL will be here to keep you informed and will keep delivering peace of mind, 24/7/365.
Follow us on social media at @ShipPGL
